Why Singapore is a great place to live and invest in
Singapore is known worldwide for being a great place for expatriates, investors and entrepreneurs looking to expand into Asia. Its development into a financial hub conducive for trade, excellent infrastructure, and a stable, progressive legal and regulatory framework are just some of the reasons that make it appealing. Why invest in Singapore? Let's explore some reasons why the city-state is a great destination for your wealth management needs or even as a new home base for you.
It's a leading financial hub in Asia
The Lion City benefits from government policies that position the country as open to trade, attract foreign direct investment inflows and that welcome overseas business setting up shop on its shores. This has cemented its position as one of Asia's top financial hubs, with many multinational corporations already establishing a pivotal presence here. Singapore is the fourth largest financial centre globally1 and the third richest in the world2. It's home to the biggest foreign exchange (FX) centre in Asia-Pacific and the third largest worldwide, after New York and London3. With these international accolades, it's little wonder the country is hailed as the de facto financial capital of the Southeast Asian region.
It's great for companies and businesses
Setting up a company in Singapore will get you access to its infrastructure, which is conducive for both overseas investors and businesses. Investors and businesses have long experienced great ease of doing business in Singapore, and it was voted top in Asia for its efforts in protecting intellectual property4 and ranks fourth worldwide on the Corruption Perceptions Index5.
Wondering how to invest in Singapore? The country's Economic Development Board (EDB) dedicates significant resources towards overseas businesses and individuals to start up here, providing high-quality assistance along the way.
In fact, its efficient regulatory framework makes it hassle-free to incorporate a company or business, which is a big plus if you're an overseas investor. To register your business officially, just submit the company registration form and relevant documents to the Accounting and Corporate Regulatory Authority of Singapore (ACRA). Once your company's incorporated, you're all set to open a bank account and kick things off.
Business gateway to the world
Singapore's strategic location in the heart of Southeast Asia makes its port a major player that is always bustling with activity.
Its proximity to other countries and key markets in the region open up many possibilities for investors and businesses based here. In fact, many Chinese and Australian producers and trading houses have major offices in Singapore, boosting its position as the region's stand-out commodities hub6, in case you're wondering what to invest in in Singapore.
Thanks to its stance on promoting international trade and business, Singapore has an extensive 25 free trade agreements in place7, many with major global markets, giving investors and businesses based here great access to these important economies.
Prime hub for offshore wealth management
Singapore is appealing to investors as an offshore wealth management hub, with 58% of participants in a 2018 survey conducted by Asian Private Banker rating it as their preferred market, followed by Hong Kong and Switzerland8.
This comes as little surprise as the city-state's renowned stability, openness to international investment, and economic strength make it a choice destination for investors, as well as foreign business owners looking to invest in Singapore. The proof is in the pudding: some 76% of the assets under management (AUM) in Singapore in 2019 originated overseas9.
The little red dot has a tax system that makes it appealing for expatriates and investors. Income tax rates for individuals residing in Singapore are progressive in nature and range between 0% to 22%10 . Currently, Singapore does not impose capital gains tax, inheritance tax and estate duties. Investors don't have to pay stamp duties when they purchase scripless shares listed on the Singapore Stock Exchange, where the transfer of such shares is made by the Central Depository (CDP) via electronic means.
Businesses based in Singapore are subject to a flat corporate income tax rate of 17%. There are various tax incentives and grants available to businesses based in Singapore.
Great quality of life
Besides factors directly related to investments, the quality of life in Singapore is also a big pull. The republic has a stable and progressive political environment promising a secure and peaceful life, as well as a strong workforce that's able to offer employment to individuals in multiple industries and sectors. It also boasts a multiracial and multicultural society that embraces diversity and inclusiveness. These qualities contribute to it being the only country in Asia-Pacific that has received a stellar AAA long-term sovereign rating by Moody's, Fitch and S&P11, which represents the highest issuer credit rating given to countries.
Singapore also is home to a world-class education system, which is good news for families looking to relocate or have their children go to school here. It's one of the most popular global destinations for parents considering a well-rounded, rigorous overseas education for their children, with Nanyang Technological University (NTU) and the National University of Singapore (NUS) both ranking 11th among universities worldwide12.
All in all, there are so many reasons why moving to Singapore or investing in the Lion City are worth exploring. But most of all, knowing that the country truly welcomes and embraces foreign residents and businesses is perhaps its biggest allure.
1 "The Global Financial Centres Index 26", Long Finance, September 2019
2 "These are the 25 richest countries in the world", Grant Suneson, USA Today, 7 July 2019
3 "Singapore is largest forex centre in Asia, third largest globally", The Straits Times, 1 September 2019
4 Singapore's IP ranking, Intellectual Property Office of Singapore
5 Transparency International, 2019
6 "Singapore increases scrutiny on commodity trading and marketing companies", Sowmya Varadharajan, ITR, 30 July 2020
7 Ministry of Trade and Industry Singapore
8 "The Role of Singapore as an Offshore Wealth Management Hub", Asian Private Banker, 2018
9 "Singapore-based asset managers' AUM jumps 15/7% last year: MAS survey", Vivien Shiao, The Business Times, 30 September 2020
10 "https://www.iras.gov.sg/irashome/Individuals/Locals/Working-Out-Your-Taxes/Income-Tax-Rates/", IRAS Singapore
11 Sovereigns Ratings List, Country Economy